Decision Intelligence: Supercharging Machine

Learning to 1000s of new use casesDr. Lorien Pratt, Chief Scientist, Quantellia Copyright © 2014 Quantellia LLC

Question: If technology could solve one problem for you, that it doesn’t solve today, what would it be?

Question: If technology could solve one problem for you, that it doesn’t solve today, what would it be?

Answer: Massive amounts of data, machine learning, other advanced technology, but it’s not getting used for the most important decisions.

GAPMachine Learning

Analytics

Data

Decision Makers

What will be the impact of today’s decision, tomorrow?

Decision Makers

Machine Learning

Analytics

Data

Complex interdependencies, with

critical consequences

Source: Tibco Jaspersoft

From… To…

“Isn’t there a better way? I am making big decisions: is there a way to structure all this data, and to use machine learning, to get the most value out of it?”

Source: Tibco Jaspersoft

From… To…

Many new use cases

Two ways we use data

Big Decisions

DataInstrumented

Code / Sensors

DataManagement

Analytics

Presentation

DataInstrumented

Code / Sensors

DataManagement

Analytics

Presentation Demarcation between automated (computer-centric) and manual (human-centric) information processing

Gap between computer and humanbridged by Data Visualization

DataInstrumented

Code / Sensors

DataManagement

Analytics

Presentation

System Analysis

Decision

DataInstrumented

Code / Sensors

DataManagement

Analytics

Presentation Demarcation between automated (computer-centric) and manual (human-centric) information processing

Gap between computer and humanbridged by Data Visualization

What is a the relationship between data, systems, and decisions?

Decision Lever

Outcome

Outcome

Outcome

External Factors

Decision Lever

Intermediates

External FactorsExternals

Intermediates

Intermediates

Goal

Each connector represents a dependency.

Goal

Goal

Big Decisions

Intervention

Impact

analysis

How can we best

deploy security to

ensure a fair

election?

How can we

maximize the value

of aid to reduce

childhood

mortality?

“FACTIVISM”Factivism

“Poor decision making can cost–

and, in an industry that invests as

much as telecoms, the total cost can

be very large indeed.”

“Our research reveals that, in

the past decade, the average

long-term return on investment

(ROI) has been just 6%—three

percentage points less than the

cost of the capital itself.”

“What is critical in today’s complex world is the ability to see over the horizon and around corners to understand the impact of today’s decisions on all of the desired outcomes.”

Adam-Bryce, LLC (919) 638-0707

“We are seeing increasing demand for a C-level executive who understands how to use data and machine learning to support business decisions.

This may end up as a role for the CIO, Chief Data Officer (CDO), or a new role may emerge: the Chief Decision Officer: who is in charge of using expertise and evidence to support the company’s most important business decisions”

A new f ie ld

DECISION

INTELLIGENCE

A new f ie ld

DECISION

INTELLIGENCE

Today

Big Data

Big

Decisions

A view of the future….

A challenge

TRADITIONAL VIEW

What will

be the

outcome?

What

decisions

can we

make?

Data, Analytics, Big

Data, Reports,

Predictive Analytics,

Spreadsheets

DECISION INTELLIGENCE VIEW

What data, analytics, reports, human

expertise, and other assets are relevant?

What outcomes

do we need or want to reach ?

What decisions will get us

there?

“…our predictions may be more prone to failure in the era of Big

Data.

As there is an exponential increase in the amount of available information, there is likewise an

exponential increase in the number of hypotheses to investigate.

For instance, the U.S. government now publishes data on about 45,000 economic statistics. If you

want to test for relationships between all combinations of two pairs of these statistics–is there a

causal relationship between the bank prime loan rate and the unemployment rate in Alabama?–

that gives you literally one billion hypotheses to test.

But the number of meaningful relationships in the data–those

that speak to causality rather than correlation and testify to how

the world really works–is orders of magnitude smaller.”

—Nate Silver

Who correctly called the outcomes of the 2012 US Presidential election in all 50 states

Elements

Need:

1) A systems model (with systems dynamics, feedback loops, etc.)

2) Machine learning

3) Information from experts for when data is missing

4) Simulation

5) Optimization

6) Crystal clear visualization

7) An agency model to add to the information model

8) Interactivity

What will be the impact of today’s decision, tomorrow?

Decision Makers

Machine Learning

Analytics

Data

A DECISION INFLUENCES A SYSTEMS MODEL, WHICH RESULTS IN OUTCOMES

Decision Lever

Outcome

Outcome

Outcome

External Factors

Decision Lever

Intermediates

External FactorsExternals

Intermediates

Intermediates

Goal

Each connector represents a dependency.

Goal

Goal

The CDO’s responsibility is to fill this gap

Decision Makers

Machine Learning

Analytics

Data

Lack of consistent

service

Net Promoter

Score

Irrelevant proactive

notifications

Invest in consistent customer data

Pain of having to deal with the call

center

Invest in self service improvement via the

smartphoneHow many

people use the call center

Invest in improving the call center

Churn

Levers

Outcomes

Externals

Revenue

LoyaltyBetter proactive

resolution of issues

Customer calling behavior

Customer needsMy competitor’s

NPSCompetitor advertising

Cause Effect

Machine Learning rule, from historical data that captures this link

Lack of consistent

service

Net Promoter

Score

Irrelevant proactive

notifications

Invest in consistent customer data

Pain of having to deal with the call

center

Invest in self service improvement via the

smartphoneHow many

people use the call center

Invest in improving the call center

Churn

Levers

Outcomes

Externals

Revenue

LoyaltyBetter proactive

resolution of issues

Customer calling behavior

Customer needsMy competitor’s

NPSCompetitor advertising

“If I make this decision today, how will it affect my outcomes in the future?”

Decision Lever

Outcome

Outcome

Outcome

External Factors

Decision Lever

Intermediates

External FactorsExternals

Intermediates

Intermediates

Goal

Each connector represents a dependency.

Goal

Goal

Forward modeling

Decision Lever

Outcome

Outcome

Outcome

External Factors

Decision Lever

Intermediates

External FactorsExternals

Intermediates

Intermediates

Goal

Goal

Goal

Optimization

Decision Lever

Outcome

Outcome

Outcome

External Factors

Decision Lever

Intermediates

External FactorsExternals

Intermediates

Intermediates

Goal

Goal

Goal

How do we maximize profit? Should we

generate our own renewable energy? If so,

when is the best time to do so?

Tens of millions of dollars in savings potential

per year for a typical large enterprise

How do we best invest in the legal system to set a developing country on a road to

avoid future conflict?

Should we invest in buildings and books or motorcycles and paralegals?

Thousands of lives at stake

“Is my money better

spent on more

servers or more

iPads?”

“Which buildings should I

transform to cloud/VOIP first, to

maximize business benefit?

Typical – 72 homes per Node Optimal – 115 homes per Node

“Where should I place network equipment to build the next

internet, at the lowest cost and maximum value to customers?”

“Where should I place wifi hotspots in my town to provide the

best customer service and to maximize revenues?”

What to do next?1. Start thinking about your

organization’s “big decisions”2. Identify outcomes and goals3. Identify levers4. Identify externals5. Build a decision model picture to

show how they connect6. Identify data that can be learned from

to analyze cause-and-effect links.7. Where data is missing, find human

expertise8. Combine existing learned rules as

parts of the full decision model9. Assign someone to be responsible10. Learn about complex systems analysis11. Learn about optimization and

simulation

Learn more on at http://www.youtube.com/quantelliaUnified resource: http://www.scoop.it/t/decison-intelligence

Thank YouDr. Lorien Pratt, Chief Scientist, @Quantellia, www.quantellia.com

Lorien.pratt@quantellia.com

+1 303 589 7476

http://www.scoop.it/t/decision-intelligence

Copyright © 2014 Quantellia LLC